Is a 100 million RE portfolio a reasonable goal?
Member since 2019 · 215 posts · 94 votes
Hello everyone, I’m currently a junior in high school. I would like an asset amount of 100 million(not necessarily net worth) around my 50s-60s. I plan on starting to invest in RE ASAP! Most likely around 20-21 if not sooner(as I have heard 2 years of work experience is needed to secure most loans). I would just like to get you guy’s thoughts on this topic as I don’t see many people talking about 9 figure portfolio goals. Thanks for any input you guys have, stay safe everyone :)
Sure why not. But let's learn how to crawl before we run a marathon.
1. Lets get to $10k which will teach you how to get to $50k
2. $50k will teach you how to get to $100k
3. $100k will teach you how to get to $250k
4. $250k to $500k then to $1m.
Each accomplishment will teach you how long it took to get there, what skills you needed, and how much work to accomplish each level.
Lofty Goals are good and you always want shoot for the stars but tangible short term goals compounded = results. It's all about action and making it happen. Best of luck on your journey!
I'd start with 1 house and a strong why.
Mine is freedom and choices so $100M sounds like a nightmare. SMART goals are key, but start with why. Ask yourself 7 times.
I haven't clocked-in in 18 years. Bull, bear, recession, depression, quarantine dont affect my naps period. Freedom from anxiety.
Too big to me = too much work. YMMV.
@Jordan Lucas love your ambition and its definitely realistic with direct focus.
If that is truly your goal, reverse engineer what that would look like. What does that look like in year 1 to year 5. Then what it looks like in 10 years, 15 years, 20 years, ect.
That will help cement some clarity. Look for mentors, education and conferences to attend along the way.
Your experiences and willingness to learn and apply dictate your final destination.
Happy investing!
@Llewelyn A. I absolutely love that approach! I will do the very best I can and see what happens!
@Rick Pedi that’s very understandable! Thanks so much for your input!
@Jay Hinrichs 100x! We can’t help it!
@Michael Kramer will do! Thanks so much for the advice!
@Cooper Harris thanks so much for that advice, I really appreciate it! I got the book from thrift books, just need to get around to reading! Definitely going to bump it up on my what to read list!
@James Farrel very well said! Thank you!
@Jason Dasilva thanks so much for that advice I definitely will! Originally I listened to it from audiobooks, but it might be time to buy the book as I like holding them in hand and feel I grasp the information better.
@Cheryl Branche thanks so much! That is very true
@Nick Heil thanks so much for that great advice and words of encouragement, they meant a lot!
@Rashad Jones Jennings thanks so much for that! Most definitely!
@Steve Vaughan that makes a lot of sense, thanks so much! I get what your saying a lot and starting with a one house and a strong why will be crucial for me
@John Fortes thanks so much I really appreciate it! I definitely will work backwards and look for mentors and other learning opportunities along the way!
@Jordan Lucas, hi and welcome to BP!
I'm going to take the contrarian view....because it's in my nature.
First, WHY in the world do you want $100 million? "To be successful" is not a reason: that's vanity and pride talking. There are tons of highly successful people who have lives rich with friends, family, etc that have only a fraction of that.
Freedom? Nah, forget it. If you have $100 million in net worth, the word "freedom" will disappear from your vocabulary for the next 20-40 years. Here's why.
There are a lot of greedy people willing to back stab anyone for as little as a $10,000 payout. So if we do a little math, that means you'll create about 10,000 people "on your way up" the wealth and social ladder who will want nothing more than to take you down and get a piece of the action. Vast wealth breeds jealousy, rivals, competition, etc. You will attract greedy 'friends' and women who want nothing from you but to hang out and siphon off your money. Google the term "gold digger" to get an idea. You will also attract the attention of ambulance chasing lawyers waiting to sue you for any reason under the sun. You will attract fundraisers and charities who will hound you for funds constantly. People you knew in 1st grade will reappear in your life and expect hand outs. Family will expect you to give them money and get angry if you don't give them what they feel is "their right." Not everyone, but quite a few. In other words, you will be working 10x harder to KEEP your money than you will to EARN it, and you'll be facing the judgment of others who believe you owed them something. On that topic...
You may have noticed recently that the political winds are blowing AGAINST the wealthy much harder today than 10 years ago. Politicians (i.e. the entire Democratic party) and their leaders like Bernie Sanders and AOC are calling for wealth redistribution. Think they won't get a slice of your pie? The Govt is spending money by the Trillions. Do not think for a moment you won't be paying a HUGE chunk of your money toward that in taxes, fees, and/or regulatory compliance.
The tax man is already set up today to beat you up considerably. $100 million in wealth will probably require you to pay millions in taxes to acquire, unless you hire an army of accountants. With talks of having a 90% upper income tax bracket as well as a yearly "wealth" tax, things are likely only going to get worse.
Now let's talk about what you plan to DO with that money. What's your end goal? Move to Beverly Hills? Buy a private jet or a yacht? Go to ritzy clubs and "make it rain" $100 bills?
Wealth loses it's utility beyond a certain point. Sure you can do all kinds of crazy stuff like I just mentioned, but there will always be someone richer than you. As you start to move upward thru the circles of wealth, you have to ask yourself, "Is this truly improving my life, or is it just showing off?" Again, it goes back to pride and vanity. Building great wealth can lead to always wanting more, more, more....when is it all "enough?" If you can't answer that question: you're not ready to build that level of wealth without sacrificing a lot of things that could possibly make you much happier and a more satisfied person.
Do you plan to have a family? Kids? How much time are you prepared to spend away from them at critical moments of their lives? $100 million fortunes are not build around 40-hour work weeks. Also, what will a kidnapper think when they see your spouse and children out in public? What will they think about your reputation? Could be tempting. How will you defend them...body guards? What will a blackmailer think about your reputation, except how to smear your name as a threat to make you pay up for him to shut up? These are real things for the very wealthy to consider.
So I humbly suggest you do some intense soul searching before embarking on this quest. Before you start diving into the "HOW"...you really need to have a rock solid "WHY." Having a ton of money isn't all glamour. There's a lot of pain and suffering to get it, and once you get it, how much better is a 30,000 sq foot mansion than a 20,000 sq ft one? You'll just have to hire 3 more full time landscapers to trim the bushes that you never get time to sit down and enjoy.
Maybe this isn't the kind of answer you expected on Bigger Pockets. My goal isn't to discourage you. It's to make you think.
My goal is contentment, having what I need as well as a surplus to enjoy and also do good work in charitable causes I'm passionate about. In my view, wealth beyond $2 million net worth where I live in the Mid-West is more of a burden than a blessing. I don't see much use in added wealth beyond that point, except as a resource to help others. If that's one of your goals, then I think you've got something good in your heart that could carry you forward on this journey. You'll need it, because it's not an easy road, which is why only about 1 person in 100,000 actually gets where you're aiming to go. It can be done, but you have to want it....all of it. Not just the money, but everything listed above that comes with it. Consider it all carefully.
Best wishes!
@Erik Whiting wow I really appreciated your response and definitely get the message. Many of those things I haven’t even thought about and you are making wheels turn in my head and questions on questions appear. I will have to do more thinking and questioning to myself. Once again I really appreciated it this, thanks a lot!
@George W. 100 million seemed like a big enough goal that even if I didn’t achieve it I would still be setting myself up for success. I appreciate your detailed response and take note in the what not to do’s, budgeting, and practical advice for small short term goals that will eventually compound into something else!
Note, that $100M, 30-40yrs from now, will be worth arround 70% of what you're saying now ;)
Anyway, still worth of pursuing :)
@Jordan Lucas
Most of the people who are on this thread (if not all) are not the ones to ask and neither am I. If you're REALLY serious and not just a made up number, you follow those who are doing it. You have ppl who are doing well on this forum but not controlling 100M portfolios. You find THOSE people! Seek them out! Work and learn under their tutelage! You have to learn sales and syndication! To amass 100M, you can't start with single family and duplexes! You're in the wrong mindset. Is that your goal? Your grind and focus? You willing to sacrifice? They play differently! I have a nice, modest lifestyle that real estate and other forms of passive income help. I do not have a 100M mindset. And don't let others who don't have that mindset tell YOU what you can't do because theirs is limited as well. Good luck if that's what you truly want.
Possible? Absolutely! Reasonable depends on you!
You are in the right place on BP to make it happen. We acquired 60 units years ago and it was "enough". It gives us the freedom to live a lifestyle we enjoy while pursuing our dreams and other interests. It is also not too much to handle.
You are going to put up with an amount of stress and pressure to hit that goal. That's okay. The question is does it make sense for you to trade of the amount of "junk" you will have to go through to trade for the pay off off a $100 million portfolio. If the answer is yes, then go for it full steam ahead. Be prepared for "dah-rah-mah" ahead of you - but do NOT give up - ever!!!
Curious about the $100 million mark though. Step back for a minute and ask yourself, "What is your WHY?" Why is the $100 million mark so important to you? Only you can answer this one. Mine was to replace our income so we did not have to work when we were older and take care of my wife and family for generations to come.
On a side trail. When we interview people who want to work at our property management agency, we ask a ton of questions. Most are not about if they "want to work there", or "what is their skillset". It is more about their drive and their character. We used to ask candidates "What would you do with $1 million dollars?" That question was too easy to answer - so we upped it to $10 million. The purpose is to reveal their character. What do they care about? What are they passionate about? What is their "Why"?
So our 2 favorite questions are:
@Jordan Lucas, hi and welcome to BP!
I'm going to take the contrarian view....because it's in my nature.
First, WHY in the world do you want $100 million? "To be successful" is not a reason: that's vanity and pride talking. There are tons of highly successful people who have lives rich with friends, family, etc that have only a fraction of that.
Freedom? Nah, forget it. If you have $100 million in net worth, the word "freedom" will disappear from your vocabulary for the next 20-40 years. Here's why.
There are a lot of greedy people willing to back stab anyone for as little as a $10,000 payout. So if we do a little math, that means you'll create about 10,000 people "on your way up" the wealth and social ladder who will want nothing more than to take you down and get a piece of the action. Vast wealth breeds jealousy, rivals, competition, etc. You will attract greedy 'friends' and women who want nothing from you but to hang out and siphon off your money. Google the term "gold digger" to get an idea. You will also attract the attention of ambulance chasing lawyers waiting to sue you for any reason under the sun. You will attract fundraisers and charities who will hound you for funds constantly. People you knew in 1st grade will reappear in your life and expect hand outs. Family will expect you to give them money and get angry if you don't give them what they feel is "their right." Not everyone, but quite a few. In other words, you will be working 10x harder to KEEP your money than you will to EARN it, and you'll be facing the judgment of others who believe you owed them something. On that topic...
You may have noticed recently that the political winds are blowing AGAINST the wealthy much harder today than 10 years ago. Politicians (i.e. the entire Democratic party) and their leaders like Bernie Sanders and AOC are calling for wealth redistribution. Think they won't get a slice of your pie? The Govt is spending money by the Trillions. Do not think for a moment you won't be paying a HUGE chunk of your money toward that in taxes, fees, and/or regulatory compliance.
The tax man is already set up today to beat you up considerably. $100 million in wealth will probably require you to pay millions in taxes to acquire, unless you hire an army of accountants. With talks of having a 90% upper income tax bracket as well as a yearly "wealth" tax, things are likely only going to get worse.
Now let's talk about what you plan to DO with that money. What's your end goal? Move to Beverly Hills? Buy a private jet or a yacht? Go to ritzy clubs and "make it rain" $100 bills?
Wealth loses it's utility beyond a certain point. Sure you can do all kinds of crazy stuff like I just mentioned, but there will always be someone richer than you. As you start to move upward thru the circles of wealth, you have to ask yourself, "Is this truly improving my life, or is it just showing off?" Again, it goes back to pride and vanity. Building great wealth can lead to always wanting more, more, more....when is it all "enough?" If you can't answer that question: you're not ready to build that level of wealth without sacrificing a lot of things that could possibly make you much happier and a more satisfied person.
Do you plan to have a family? Kids? How much time are you prepared to spend away from them at critical moments of their lives? $100 million fortunes are not build around 40-hour work weeks. Also, what will a kidnapper think when they see your spouse and children out in public? What will they think about your reputation? Could be tempting. How will you defend them...body guards? What will a blackmailer think about your reputation, except how to smear your name as a threat to make you pay up for him to shut up? These are real things for the very wealthy to consider.
So I humbly suggest you do some intense soul searching before embarking on this quest. Before you start diving into the "HOW"...you really need to have a rock solid "WHY." Having a ton of money isn't all glamour. There's a lot of pain and suffering to get it, and once you get it, how much better is a 30,000 sq foot mansion than a 20,000 sq ft one? You'll just have to hire 3 more full time landscapers to trim the bushes that you never get time to sit down and enjoy.
Maybe this isn't the kind of answer you expected on Bigger Pockets. My goal isn't to discourage you. It's to make you think.
My goal is contentment, having what I need as well as a surplus to enjoy and also do good work in charitable causes I'm passionate about. In my view, wealth beyond $2 million net worth where I live in the Mid-West is more of a burden than a blessing. I don't see much use in added wealth beyond that point, except as a resource to help others. If that's one of your goals, then I think you've got something good in your heart that could carry you forward on this journey. You'll need it, because it's not an easy road, which is why only about 1 person in 100,000 actually gets where you're aiming to go. It can be done, but you have to want it....all of it. Not just the money, but everything listed above that comes with it. Consider it all carefully.
Best wishes!
Pretty cynical view, Erik :).
I agree those things can happen...but I'd estimate they happen more to those who 'show off' they have that much.
I just met a guy who probably controls around $50M in RE (his family has been in the town since 1905), but he works in a tiny, untidy office and drives a beat-up truck.
He's probably less of a target as many of his properties are in trusts and multiple LLCs.
Compare that to...say...Grant Cardone :).
Who likely has more trouble?
@Joe Cassandra, agreed. This is precisely why Mr. Jordan has to figure out WHY he wants $100 million. He hasn't told us yet...unless I missed it somewhere in these 4 pages of posts.
I think everyone should ask him/herself: What would I do with $100 million personally? I get it that there are a few "Sam Walton" types out there who drive the same old Ford truck, but many (perhaps most?) young people who think of massive wealth are thinking summer-long parties in Ft. Lauterdale and 50,000 square foot beach front mansions, which makes them exactly the kind of target I describe.
"The Millionaire Next Door" types are usually under $10 million net worth per Dr. Thomas Stanley's book "The Millionaire Mind". They're the ones you don't see most times.
@James Wise thank you so much! This is very good information and been doing a lot of research in Ohio mainly in colombus and Cincinnati. Appreciate you
That is a great goal! I want to just clarify a couple phrases and claims that are made online (mainly social media) where someone invests passively or actively into a syndication and then claims these units are theirs.
If person A invests $50k passively into a syndication worth $10 million and person B invests $100k passively in a deal worth $1 million; person A is truthfully an investor in a $10 million asset however person B has more equity in their deal etc. What I am saying is that people throw around door numbers and the total value of the property they are a general partner or limited partner in and it really does not show their true net worth, monthly income etc. (but it does sound cool at conferences).
I would focus more on consistent monthly income goals and the net worth will follow right behind. I would rather have less properties, with less debt and more consistent cashflow as my end goal than 9 or 10 figures worth of property. Remember, the value of your real estate only matters when you; buy, sell or refinance...other than that it is just good for (Zoom) cocktail parties.
@Adam Blachnio that makes sense thanks for that!
@Charles Carillo that makes a lot of sense. Monthly cash flow > property. That’s a great focus for me and something I need to restructure into my goals! I love the joke at the end :)